FAQ

What Is The Deadline For Applying For A Business Loan?

There is a continuous intake for our Micro Loans and Business Improvement Loans.

For Small Business Loans over $10,000, please submit your application by noon on the first Tuesday of the month.

We encourage you to come into the office and meet with our Business Loans Officer to discuss your financing requirements – there may be additional programs you and/or your business are eligible for.


 

What Is Your Average Small Business Loan Size?

Last year,  the average youth entrepreneur loan amount was $32,000; the average startup business loan was $125,000 and the average business expansion loan was $80,000 


 What Is Your Average Interest Rate?

Last year, our average interest rate for a small business loan was 7%. Our interest rates range from 0% to 12%, with the majority being between 5-7%


 Do I Need To Be Turned Down By A Bank To Qualify For A CFDC Loan?

No. Community Futures encourages all loan applicants to meet with their existing financial institution first.  Many of our clients want additional support – not just a loan, they are looking for business advisory services or mentoring – services not typically provided by traditional lenders.

It’s not always possible to get 100% funding from one lender. Community Futures often partners with banks, credit unions and the BDC to put together the best financing solution for our clients.


 

What Is The Difference Between A Demand Loan & A Term Loan?

A term loan is the period of time your offer to finance agreement is in effect. The term is not to be confused with amortization period. For example, your loan could have a 2 year term and an amortization period of 10 years. 

A demand loan can be called in by the lender at any time and is repayable early at the option of the borrower. Community Futures does not charge any fees for early repayment.

Our Business Loans Officer can meet with you to answer your questions in more detail.


Does Community Futures Charge For Advisory Services?

No. All of the services we offer entrepreneurs and small business owners is confidential and free of charge.

You do not have to apply for financing if you use our advisory services. We are more than happy to review your business plan before you meet with your current financial institution.


Where Can I Get A Business Plan Template?

A business plan is a valuable tool for every business owner, whether you are starting up, have been in business for years, or are ready to grow.

The most effective business plans are dynamic documents that evolve as your business grows and changes. Your plan should reflect the current reality of your business, the environment in which it operates, and your present and future goals. You will want to write the plan as if the reader is not familiar with the type of business you are starting.

You can meet with the Business Advisory Centre at Peterborough Economic Development for some tips on writing your business plan, or you can visit any of these websites for business plan templates that will work best for your needs:

http://www.bdc.ca/EN/articles-tools/entrepreneur-toolkit/templates-business-guides/Pages/business-plan-template.aspx

http://www.futurpreneur.ca/en/resources/start-up-business-planning/tips-tools/business-plan-writer/

http://www.canadabusiness.ca/eng/page/3426/?src=mm2


 

Will You Use My Company Name In Your Advertising?

We respect the privacy of all our small business loan clients and all clients that we provide business counselling to. We only name clients that wish to participate in our marketing campaigns. There is no obligation to participate.  

Our Eastern Ontario Development Program has mandatory ‘visibility requirements’ that must be adhered to a condition of funding as this program is a non-repayable contribution (grant).


 What Is Community Economic Development (CED)?

Community Economic Development (CED) is action by people locally to create economic opportunities and better social conditions, particularly for those who are most disadvantaged.

CED is an approach that recognizes that economic, environmental and social challenges are interdependent, complex and ever-changing.

To be effective, solutions must be rooted in local knowledge and led by community members.  CED promotes holistic approaches, addressing individual, community and regional levels, recognizing that these levels are interconnected.

Click here to view a video about CED:  https://ccednet-rcdec.ca/en/what_is_ced


How Is Community Futures Funded?

We were established in 1985 by the Government of Canada and is one of 269 Community Futures Development Corporations across the country.

Community Futures is a not-for-profit corporation with a volunteer Board of Directors. Community Futures Peterborough currently receives 100% of our operational funding from FedDev Ontario (the Federal Economic Development Agency of Southern Ontario).  Community Futures Peterborough does not receive any Provincial or Municipal funding.


 

 

 Do You Offer Lines Of Credit? Personal Loans?

We do not offer lines of credit or personal loans.  We offer loans to small & medium sized businesses located, or planning to locate within the City or County of Peterborough. 

 


 Do You Offer Workshops For Small Businesses & Startups?

Occasionally we offer workshops for small business and startups. We are proud to be a member of Startup Peterborough. Startup Peterborough is a collaboration that will facilitate connections between entrepreneurs and the local organizations and institutions that provide resources and programming for startup businesses.  resource for all entrepreneurs looking to start or grow their business.

 Visit http://www.startuppeterborough.ca/events-calendar/  to see a calendar of local workshops & events.

 


 What Does Community Futures Look For In A Loan Application?

When your local Community Futures staff and volunteer Board of Directors assess the merits of your loan application, they take into account our own version of the classic banking industry guideline “The Five C’s of Lending.”

As we are developmental lenders – and because community economic development is our number one priority – we are able to interpret and prioritize lending criteria a bit differently than traditional banks.

Here’s some insight into the criteria we will use when we look at your loan application:

Character

Character is a combination of your credit history, your training and work history, and any proven experience you have at running a business. Most banks look primarily at how the loan will be secured. While this is also important to us, we value your personal experience and track record too. We’ll also want to know about the industry skills and management experience of your leadership team, because even the best business ideas don’t succeed without strong management. It’s all part of ensuring that you are set up for success in business – not just loan repayment!

Capacity

Capacity refers to your ability to take on and repay debt based on the earning potential and cash flow of the business. We look at your business plan very carefully to determine the strength and marketability of your ideas well as the viability of the business. It is therefore very important that you take the time to carefully research and thoroughly test your business concept. We also want to make sure there will be adequate cash flow, to ensure that you can realistically afford the loan. If you are asking fora loan for an existing business, we’ll look carefully at your historical financial statements. If you are starting a new business, we’ll review projected financial statements as well as data like industry averages.

Conditions

When assessing a loan request, we take great care to understand the market and conditions in which you are planning to operate your business. Is the industry mature, or emerging? What are the current political, environmental, social, and technological issues affecting the industry? To gain insight, we look at data from industry associations and government and regulatory bodies, as well as your own marketing plan research. And, of course, we factoring the ability of your business to help drive rural economic diversification – adding recognition for big potential impacts.

Capital

Capital includes your personal and corporate net worth, the “Sweat” and real equity you have invested in the business and your ability to access other financial reserves. We want to make sure you have adequate capital to grow your business and to weather any unexpected emergencies or setbacks. Having insufficient capital is a common mistake for too many businesses, and we want to ensure it doesn’t happen to you.

Collateral

Because Community Futures organizations are developmental lenders, we place a greater focus on the management team, business capacity, market conditions, and cash flow of a business. However, we do have a responsibility to lend money responsibly, and therefore must take adequate security.

 

 Your chances of obtaining a loan depend upon how you are assessed in each of these areas. By becoming familiar with these 5 criteria, you can ensure that your business plan addresses all the essential points, and that you are prepared to answer any questions the review board may have.

Be ready to show us the creativity, energy and drive behind your business idea – and we’ll do our best to help.


 

What Is A Business Number (BN)?

In order to qualify for financing from Community Futures you need to have a Business Number.

The Business Number is a similar concept to the Social Insurance Number (SIN) that individuals have. You can register for your Business Number and/or find out more information by visiting www.businessregistration.gc.ca or by calling 1-800-959-5525. The BN is issued by the Canada Revenue Agency (CRA) and is used to unify all accounts a business may have with the federal government. The BN is used to operate corporate income tax, import/export accounts, payroll deductions, HST and other government accounts.


What Is A NAICS Code?

The North American Industry Classification System (NAICS) represents a continuing cooperative effort among Statistics Canada, Mexico’s Instituto Nacional de Estadística y Geografía (INEGI), and the Economic Classification Policy Committee (ECPC) of the United States, acting on behalf of the Office of Management and Budget, to create and maintain a common industry classification system. 

NAICS divides the economy into twenty sectors. To find your specific NAICS code, visit http://www23.statcan.gc.ca/imdb/p3VD.pl?Function=getVDPage1&db=imdb&dis=2&adm=8&TVD=118464

 

  • 111-112 Farms
  • 113 Forestry and logging
  • 114 Fishing, hunting and trapping
  • 115 Support activities for agriculture and forestry
  • 211 Oil and gas extraction
  • 212 Mining and quarrying (except oil and gas)
  • 213 Support activities for mining, and oil and gas extraction
  • 221 Utilities
  • 236 Construction of buildings
  • 237 Heavy and civil engineering construction
  • 238 Specialty trade contractors
  • 311 Food manufacturing
  • 312 Beverage and tobacco product manufacturing
  • 313 Textile mills
  • 314 Textile product mills
  • 315 Clothing manufacturing
  • 316 Leather and allied product manufacturing
  • 321 Wood product manufacturing
  • 322 Paper manufacturing
  • 323 Printing and related support activities
  • 324 Petroleum and coal product manufacturing
  • 325 Chemical manufacturing
  • 326 Plastics and rubber products manufacturing
  • 327 Non-metallic mineral product manufacturing
  • 331 Primary metal manufacturing
  • 332 Fabricated metal product manufacturing
  • 333 Machinery manufacturing
  • 334 Computer and electronic product manufacturing
  • 335 Electrical equipment, appliance and component manufacturing
  • 336 Transportation equipment manufacturing
  • 337 Furniture and related product manufacturing
  • 339 Miscellaneous manufacturing
  • 411 Farm product merchant wholesalers
  • 412 Petroleum and petroleum products merchant wholesalers
  • 413 Food, beverage merchant wholesalers
  • 414 Personal and household goods merchant wholesalers
  • 415 Motor vehicle and motor vehicle parts and accessories merchant wholesalers
  • 416 Building material and supplies merchant wholesalers
  • 417 Machinery, equipment and supplies merchant wholesalers
  • 418 Miscellaneous merchant wholesalers
  • 419 Business-to-business electronic markets, and agents and brokers
  • 441 Motor vehicle and parts dealers
  • 442 Furniture and home furnishings stores
  • 443 Electronics and appliance stores
  • 444 Building material and garden equipment and supplies dealers
  • 445 Food and beverage stores
  • 446 Health and personal care stores
  • 447 Gasoline stations
  • 448 Clothing and clothing accessories stores
  • 451 Sporting goods, hobby, book and music stores
  • 452 General merchandise stores
  • 453 Miscellaneous store retailers
  • 454 Non-store retailers
  • 481 Air transportation
  • 482 Rail transportation
  • 483 Water transportation
  • 484 Truck transportation
  • 485 Transit and ground passenger transportation
  • 486 Pipeline transportation
  • 487 Scenic and sightseeing transportation
  • 488 Support activities for transportation
  • 491 Postal service
  • 492 Couriers and messengers
  • 493 Warehousing and storage
  • 511 Publishing industries (except internet)
  • 512 Motion picture and sound recording industries
  • 515 Broadcasting (except internet)
  • 517 Telecommunications
  • 518 Data processing, hosting, and related services
  • 519 Other information services
  • 521 Monetary authorities – central bank
  • 522 Credit intermediation and related activities
  • 523 Securities, commodity contracts, and other financial investment and related activities
  • 524 Insurance carriers and related activities
  • 526 Funds and other financial vehicles
  • 531 Real estate
  • 532 Rental and leasing services
  • 541 Professional, scientific and technical services
  • 551 Management of companies and enterprises
  • 561 Administrative and support services
  • 562 Waste management and remediation services
  • 611 Educational services
  • 621 Ambulatory health care services
  • 623 Nursing and residential care facilities
  • 624 Social assistance
  • 711 Performing arts, spectator sports and related industries
  • 712 Heritage institutions
  • 713 Amusement, gambling and recreation industries
  • 721 Accommodation services
  • 722 Food services and drinking places
  • 811 Repair and maintenance
  • 812 Personal and laundry services
  • 813 Religious, grant-making, civic, and professional and similar organizations
  • 814 Private households
  • 911 Federal government public administration
  • 912 Provincial and territorial public administration
  • 913 Local, municipal and regional public administration
  • 914 Aboriginal public administration